Essar Steel Minnesota met a deadline set by Governor Mark Dayton to repay $66 million in incentives owed the state after failing to complete a $1.9 billion integrated iron ore-to-steel mill. The governor gave Essar a deadline of Friday, December 4, to make payments to vendors on the project and provide assurances that future debts will be met on time.
After Essar Steel Minnesota paid, in full, $20 million in outstanding obligations, the governor’s office said the state will not call for an immediate repayment of the incentive loans.
“Commissioner Phillips and Ms. Polasky conducted additional due diligence efforts overnight Wednesday and Thursday. They confirmed with the company, its vendors, and its CEO, Madhu Vuppuluri, that Essar Steel Minnesota had paid, in full, $20 million in outstanding obligations to its vendors, meeting the governor’s October 12th demands,” said the governor’s press secretary, Matt Swenson.
According to the Governor’s statement, an international bank is working with Essar Steel to provide additional capital that will “help assure the completion of the project, with timely payment of its contractors and vendors, moving forward.”
“We appreciate the work and support of the governor and the state agencies as we here at Essar continue to focus our efforts on this massive project along with the support of contractors to keep construction activities progressing on the project,” responded Essar Steel officials. “We also hope to finalize a payment agreement with the governor’s administration soon to reimburse the state for the $65.9 million grant utilized to construct the publicly-owned infrastructure servicing the Essar Steel Minnesota site.
Essar Steel Minnesota scrapped plans to build the steel mill on the Iron Range due to financial problems. The taconite facility is about 75 percent completed and is expected to produce 7 million tons of pellets annually and employ approximately 350 employees.
Sandy WilliamsRead more from Sandy Williams
Latest in Steel Products Prices North America
HRC vs. CRC price spread jumps in second week of new year
The spread between cold-rolled coil (CRC) and hot-rolled coil (HRC) prices jumped during the week of Jan. 8 as cold rolled tags continued to rise while hot rolled tags held steady.
Cliffs increases sheet prices again, seeks $1,150/ton HRC
Cleveland-Cliffs is now targeting base prices of $1,150 per ton for hot-rolled coil (HRC), according to a press release on Wednesday morning, Jan. 3.
Cliffs moves sheet prices higher, seeks $1,100/ton HRC
Cleveland-Cliffs is now targeting base prices of $1,100 per ton ($55 per cwt) for hot-rolled coil (HRC).
SMU price ranges: Sheet surge continues on limited spot availability
Sheet prices shot higher again this week on the heels of another round of mill price increases as well as on reports of production and supply chain issues at certain domestic producers.
Galvanized Sheet’s Premium Over Hot Rolled Hovering Around $200/Ton
The spread between hot-rolled coil (HRC) and galvanized sheet base prices has been hovering near $200 per net ton since late July, according to SMU’s latest analysis.